Akhilesh waives Rs 1,650 crore farm loans on dad Mulayam's birthday

Chief minister Akhilesh Yadav said 7.2 lakh farmers, who've taken loans of up to Rs 50,000 from rural cooperative banks, will benefit from the waiver.

LUCKNOW: A cash-strapped Uttar Pradesh government wrote off loans worth Rs 1,650 crore to farmers on Samajwadi Party chief Mulayam Singh Yadav's 74th birthday on Thursday, fulfilling an election promise that is bound to further deplete the state's already dwindling coffers. Chief minister Akhilesh Yadav said 7.2 lakh farmers, who've taken loans of up to Rs 50,000 from rural cooperative banks, will benefit from the waiver.

"Farmers who've taken loans of up to Rs 50,000, and have deposited at least 10% of the amount by March 31, will not have to pay any further," Akhilesh said. The farm loan waiver would cost the government Rs 1,650 crore and the CM said Rs 500 crore has already been earmarked from the budget towards this.

Underscoring his government's "pro-farmer policies", Akhilesh also said he will shortly announce state advisory price for sugarcane and ensure farmers' interests. However, he remained silent on loan waiver for farmers from other government-run banks, especially those in the backward Bundelkhand region, that do not issue loans against property.

In one sense, by applying conditions, Akhilesh has whittled down the largesse which otherwise would have cost his government a staggering Rs 14,000 crore. But, in the process, farmers in the state's endemically backwards regions like Bundelkhand will gain little from the waiver.

Reacting to the government's decision, Kisan Jagriti Manch (KJM), a farmer group in UP said, the waiver will benefit a sizeable population of small and marginal farmers who take loans from rural cooperative banks, but added that this wasn't enough.

"Rs 1,650 crore is insufficient for the loan waiver scheme considering the large numbers of indebted farmers in UP. The benefit of the loan waiver scheme should be extended also to those farmers who took loans from scheduled banks in the form of crop loans,'' said KJM chief Sudhir Panwar.